Dividing partnership income, Accounting Basics

Assignment Help:

Dividing Partnership Income

Desmond Drury and Ty Wilkins have decided to form a partnership. They have agreed that Drury is to invest $44,700 and that Wilkins is to invest $104,300. Drury is to devote full time to the business, and Wilkins is to devote one-half time. The following plans for the division of income are being considered:

a. Equal division.
b. In the ratio of original investments.
c. In the ratio of time devoted to the business.
d. Interest of 10% on original investments and the
remainder in the ratio of 3:2.
e. Interest of 10% on original investments, salary
allowances of $101,400 to Drury and $50,700 to
Wilkins, and the remainder equally.
f. Plan (e), except that Wilkins is also to be allowed a bonus equal to 20% of the amount by which net income exceeds the total salary allowances.

For each plan, determine the division of the net income under each of the following assumptions: (1) net income of $447,000 and (2) net income of $196,800.

(1) Net income of (2) Net income of
$447,000 $196,800
Plan Drury Wilkins Drury Wilkins
a. $ $ $ $
b. $ $ $ $
c. $ $ $ $
d. $ $ $ $
e. $ $ $ $
f. $ $ $ $ #question..


Related Discussions:- Dividing partnership income

What is federal unemployment tax, What is Federal unemployment tax Fed...

What is Federal unemployment tax Federal unemployment tax (FUTA) requires the payment of taxes to provide benefits for workers during periods of temporary unemployment. This

Cost concept, The resources as machinery, property, buildings and land righ...

The resources as machinery, property, buildings and land rights etc. such a business owns are termed as assets. The money values allocated to assets are derived from the cost conce

Planning and budgeting, Consider the following 2008 data for Newark General...

Consider the following 2008 data for Newark General Hospitals (in millions of dollars Simple Budget_______Flexible Budget_ Actual Budget__ Revenue______$4.7$____4.8_____$4.5____.

During the week ended may 15, During the week ended May 15, 2013, Scott Fai...

During the week ended May 15, 2013, Scott Fairchild worked 40 hours. His regular hourly rate is $31. Assume that his earnings are subject to social security tax at a rate of 6.20 p

Balance sheet, Ken Young and Kim Sherwood organized Reader Direct as a corp...

Ken Young and Kim Sherwood organized Reader Direct as a corporation; each contributed $49,000 cash to start the business and received 4,000 shares of stock. The store completed its

Efficiency variances , Jackson Corporation uses a standard cost system, con...

Jackson Corporation uses a standard cost system, concerned manufacturing overhead on the basis of machine hours. The company's overhead standards per unit are given below. Varia

History of accounng, application/realization in history of accounting

application/realization in history of accounting

Generate the cash flow of companies, Rondo plc, a sports apparel manufactur...

Rondo plc, a sports apparel manufacturer with a cost of capital of 13.75%, is looking to expand its activity and is considering two possible countries to open a sales subsidiary. R

Accounting, briefly explain the accounting concepts which guide the account...

briefly explain the accounting concepts which guide the accountant at the recording stage

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd